Barclays is planning radical bonus reforms that could see staff having to wait
until they retire to collect their awards, as the bank tries to overhaul its
culture.

Barclays is planning radical bonus reforms that could see staff having to wait until they retire to collect their awards.

The proposal is one of a number being considered by the board, which is trying to overhaul the bank’s culture and restore its reputation after the damage done by former Barclays chief executive Bob Diamond’s bumper bonuses and the Libor scandal.

HSBC has already adopted the plan, which sees bonuses awarded in shares, rolled up annually, and collected when staff leave. Investors like the arrangement because it ensures bankers behave in the best long-term interests of the company, although there have been concerns about the size of the awards.

Barclays insiders confirmed that the proposal was being examined, in recognition of shareholders’ approval for the structure.

The bank is fighting hard to win over shareholders after they reacted with fury to Mr Diamond’s £17.7m pay package earlier this year. To douse their anger, Barclays overhauled his performance targets but more than a quarter of investors still voted against the remuneration report at the annual meeting.

Following the outcry, the board said it would review its bonus structures.

The issue has become more urgent since Mr Diamond was forced out in the wake of the Libor scandal, which saw Barclays fined £290m. The board is designing a new bonus package as part of the pay deal for a next chief executive, with the aim of appointing someone before the end of the year.

The new boss’s deal is likely to incorporate structures that will be rolled out across the bank under its wider bonus reforms. Other proposals could include five-year deferrals and downside targets, where bonuses are clawed back if targets are missed.

Barclays’ bonus reforms will be key to restoring its tarnished reputation. Regulators described Barclays under Mr Diamond as a bank that “sailed too close to the wind” and was “in denial” about its cultural problems. Some staff are facing possible criminal charges for rigging Libor .